Before the elections on 21 October, there was a hype by the anti-left western media that Argentina was going have its own Bolsonaro/Trump by electing Javier Milei, the far right radical anti-establishment candidate as President. But, the Argentine voters proved to be smarter. They shocked Javier Milei and his choreographers by humbling him into the second position with 30% votes.
Sergio Massa, the leftist candidate of the ruling coalition came first with 37% votes. The centre-right candidate Patricia Bullrich came third with 24%. She is out of contention for the second round of elections to be held on 21 November between Massa and Milei.
Argentina is going through yet another cycle of crisis with three digit (138%) inflation, steep currency depreciation, increased poverty and unemployment, shortage of foreign exchange reserves and huge unbearable burden of external debt. Part of the blame lies with the leftist Peronist governments in power for most part of the last two decades. So, the voters elected the centre-right Mauricio Macri as President in 2015.
However, his government also failed to arrest the deterioration of the economy. He made it worse by sinking the country in a huge debt trap by taking a 40 billion dollars IMF loan towards the end of his term. These billions were not used for any productive or revenue generating projects. The money simply disappeared, leaving the country with a severe burden of debt. During the Peronist rule between 2003 and 2014, the country was virtually debt free since the Wall Street cartels and their Washington DC accomplices kept Argentina isolated from the international capital markets. They wanted to punish Argentina for its audacious debt structuring on its own in 2002 ignoring IMF, the US Treasury Department and the Wall Street.
President Nestor Kirchner pulled off a financial coup by making the creditors (over 93%) agree to receive 30 cents to a dollars. He and his wife Cristina Fernandez, who succeeded him as President, refused to be blackmailed by the American vulture funds who did not accept the debt restructuring formula and insisted on full payments. So the Wall Street mafia blockaded Argentina from the western financial capital markets.
This was a blessing in disguise. Argentina remained free from external debt since there was no one to extend credit except for the Chinese who came to the rescue occasionally with some credit and financial swaps. Argentina struggled but remained free from the curse of external debt, which had caused many crises in the past. But this situation was changed by the pro-US Macri, who made a deal with the vulture funds and took the disastrous step of taking in 40 billion loan from IMF. This was irresponsible and malicious. This IMF debt of 43 billion dollars has become an unbearable burden for the country which has severe shortage of foreign exchange reserves. This has aggravated the economic crisis of the country. This is the reason why the voters punished Macri in the 2019 elections when he sought reelection. His candidate Bullrich was also a victim in the 2023 elections. The electors are not yet ready to forgive the grave sin of Macri.
Obviously, the country needs a change from the leftist Peronists who have failed in economic management and the rightists who worsened the crisis by adding the debt burden. It was in this context that the situation was ripe for an outsider. Javier Milei, the Libertarian candidate, was the natural choice at this time of anti-incumbency. Milei, a professional economist, promised a shock treatment and radical free-market reforms. His angry attacks against the political caste which got the country into a mess, resonated with the public. He got the most votes in the primaries held in August this year. This boosted the confidence of Milei who went overboard with extremist statements, crazy outbursts and attacks against those whom he did not like. He derided Pope Francis as "a malignant presence on earth," "filthy leftist", "a donkey", "a jackass" and "a leftist sob". This has not gone well in the catholic country which is proud of the first Argentine who has become Pope.
Milei has said he would close down the Central Bank, dollarise the economy, shut down 10 of the 18 ministries and cut social expenditure. He has taken disturbing and unrealistic foreign policy positions. He attacks President Lula and admires the disgraced ex-president Bolsonaro. He is critical of Mercosur, the regional economic bloc as well as China, the most important economic partners of Argentina. He considers global warming as a "socialist lie".
The masses struggling with poverty and economic difficulties realised that Milei has no agenda for them. Their situation would only worsen with Milei’s proposal to cut social expenditure. So they have ditched Milei and voted for the leftist candidate Massa, a known devil. In any case, Massa is a pragmatic and moderate leftist unlike the Kirchners who were extremists and confrontational.
Milei has got the message of the voters now and is toning down his rhetoric. He has realised the need for support of the moderate centre-right voters.
I believe that Argentina needs a change from the traditional left and right. An unconventional shock treatment by an outsider would be good at this time. So Milei is a natural choice. But he needs to moderate himself and become more realistic and pragmatic. Only then he has a chance in the second round of elections on 14 November.
In any case, even Milei gets elected as president he cannot impose his crazy proposals and become a monster like Bolsonaro or Trump. His party does not have the legislative majority. In the Congressional elections held simultaneously with the Presidential elections on 21 October, the leftist Peronist coalition has won the maximum seats. They got 34 seats in the House of deputies and 12 in the Senate. Milei’s party got 8 deputies and 8 senators while the centre-rightis coalition got 24 deputies and 2 senators. With these results, the new (Lower) House of Deputies will have 108 leftists, 38 Libertarians and 93 rightists out of a total of 257. In the Senate of 72 members, the leftists will number 34 while Libertarians will be 8 and rightists 24. So, Milei will need the support of the moderate rightists to pass his legislative reforms. He will have tough time in contending with the Leftist coalition which has the largest number of Deputies and Senators.
Milei would also have to live with another reality. The leftist incumbent candidate Axis Kicilloff has been reelected as governor of Buenos Aires, the largest province with 17 million people out of the total country’s population of 45 million. There are also several other provinces with leftist governors.
If Milei gets elected as president, the country would get a much-needed shock therapy. At the same time, he would not be allowed to become disastrous like Trump or Bolsonaro. The Argentine voters have built firewalls of opposition with their smart voting. It would not be bad either if the leftist Massa wins. He is mature, balanced, pragmatic and has the much needed political experience of crisis management in recent times.
The author is an expert in Latin American affairs.